Hi all,I am thinking hard to find a thesis topic for my PhD degree. Since I want to do academic research in the future, I think I have to find something fancy and hot. I am thinking of the data-mining ... looks interesting... and there should be enough problems to be solved in order to write a thesis... however, I am not sure if the Street really uses these stuff?How many people here are working on the Street?Could you please tell me if I can make a living by data-mining and game theory if I cannot find a academic research job and have to find a job on the street?Thank you so much!-M

mizhael: first let me say that you should not make any life-changing decisions based on what you read on this forum. there are a number of intelligent-sounding loonies trolling around who are perfectly happy to give out insane advice!I have been working in finance, mostly trading equity and fixed income derivatives, since 1989, so I will have a perspective based on this history.Game theory, in a sort of cocktail party loose sense, is used nearly all the time by traders in the way they trade. They think about what everybody else is doing, what positions they hold, what their motivations are, how they will react to situations, etc. In terms of the more mathematical definition, I doubt there is a lot of mathematical game theory deployed on trading floors.I am not sure what you mean by "data mining". If you mean finding predictable patterns in financial data and using the info to make money, yes, there is a hell of a lot of that going on! Nowadays the frontier seems to be in financial data on a very short time scale, as in seconds, minutes or hours. This is referred to as "tick-data". I am not an expert in this field, so can't advise you as to what is exciting. But there appear to be many conferences involving the topic.In fact, there might be a good way to see what is hot: look on some conference websites and see what everybody is talking about!Here's an example: Incisive Media

though i have not been trading (FI derivatives) as long as erstwhile... i would second what he is saying. however, if your passion is academic research you may find the street quite frustrating at times. markets and the traders that control them tend to be irrational at the worst possible moments... just ask the boyz at the former LTC. my friends that remained in academia can never understand why this irrational behaviour occurs and when it corrects itself they give me the "i told you so", however, are you liquid enough to remain solvent until the market corrects itself??? This is the practical versus the theoretical. just some food for thought.

Pick your thesis subject because you are interested in it. You'll wish you had. Trying to pick what will be considered 'hot' in three or four years time is a mugs game. But I don't think either data mining or game theory count right now.

..and when i mean 'irrational' i mean it in the academic sense. there is nothing irrational about squezzing out a large position on the street that is showing signs of weathering.

..and when i mean 'irrational' i mean it in the academic sense. there is nothing irrational about squezzing out a large position on the street that is showing signs of weathering.

..and when i mean 'irrational' i mean it in the academic sense. there is nothing irrational about squezzing out a large position on the street that is showing signs of weathering.

..and when i mean 'irrational' i mean it in the academic sense. there is nothing irrational about squezzing out a large position on the street that is showing signs of weathering.

..and when i mean 'irrational' i mean it in the academic sense. there is nothing irrational about squezzing out a large position on the street that is showing signs of weathering.

i should add that hedge funds tend to do a lot of the data mining stuff, and if by "the street" you meant wall street bulge bracket banks, then i guess data mining would not be a core activity there.

QuoteOriginally posted by: erstwhilei should add that hedge funds tend to do a lot of the data mining stuff, and if by "the street" you meant wall street bulge bracket banks, then i guess data mining would not be a core activity there.Yeah I meant the Wall street... and the place where those quants work ...

As erstwhile mentioned, the focus is on tick-data / intra-day trading especially in fx, interest rate futures and equities. There has been some research in this field but mostly proprietary in banks and hedge funds. Will it give you a PhD? Almost certainly since the field is comparatively new. But judging from my own experience the most important question is: Are you interested in the topic? I did my PhD in 3 years but it was hard work with night-shifts and weekends. The bottom-line is that if you're not interested, your thesis will be poor and you might not even get a PhD.

data mining techniques are also used a lot in credit risk applications (scoring, PD models, LGD models). With Basel II this is certainly a "hot" topic too

QuoteOriginally posted by: ntruwantdata mining techniques are also used a lot in credit risk applications (scoring, PD models, LGD models). With Basel II this is certainly a "hot" topic tooI'm curious: Why so, with regard to Basel II?-W. Dwinnellhttp://will.dwinnell.com

Quoteerstwhilum: mizhael: first let me say that you should not make any life-changing decisions based on what you read on this forum. there are a number of intelligent-sounding loonies trolling around who are perfectly happy to give out insane advice!Ah yes, but is it insane enough?! When you've been working in The City for as long as I have... Actually, when you say "Wall Street" does it have to be, like, Wall Street? Can/does The City count?